Most thinking citizens have come to the conclusion that India is
facing an extraordinary crisis today. The manifestations of this
crisis -- the all-pervasive, inefficient state, increasing
lawlessness, competitive populism, criminilisation of polity,
ever-growing nexus between money power, crime and political
power, excessive centralization, serious erosion of legitimacy of
authority and extremely tardy and inefficient justice system --
all these are only too evident to all of us.

Causes of Crisis

2. This crisis is not on account of decline in values in society,
nor is it because we have the wrong kind of people in politics,
bureaucracy and judiciary. Essentially, the crisis of
governability in India is a result of two major flaws in our
governance structure. Firstly, good behaviour is not consistently
rewarded by the Indian state, and bad behaviour is not
consistently checked or punished. In fact, the contrary is true,
and there is a strong feeling throughout the country that in our
governance structure it is bad behaviour that ensures rewards and
success. Thanks to a very poor design of our democracy despite
noble intentions, honesty is no longer compatible with survival
in political office, and politics and honour do not seem to
coexist.

3. The second major flaw in our system is in the nature of power
and its exercise. If power is defined as the ability to influence
events, resources and human behaviour for the larger public good,
then such power is severely restricted in our state functionaries
at every level. Though it is difficult to quantify this
phenomenon, some effort to do so may enhance our understanding of
the problem. On a scale of achievement by state functionaries, if
a quantum of 100 is what is possible in a well-functioning
governance structure, and what is necessary in a well-run civil
society, then the best of the functionaries in the Indian state
are able to achieve only about 15 to 20 on this scale. Whether
these functionaries are the occupants of high public office like
the Prime Minister, Union ministers and Chief Ministers or other
elected politicians or appointed public servants or the members
of judiciary, this limitation is very evident at every level in
every organ of our state. If however power is defined as pelf,
privilege, patronage, petty tyranny, harassment, or nuisance
value, then almost all our state functionaries enjoy this
negative power in abundance. This imbalance between the exercise
of positive power and negative power is the most striking feature
of the failure of the Indian state. As a result of this
imbalance, all state functionaries have perfectly plausible,
rational and realistic explanations and alibis for non-performance.
The hapless citizen, who expects results, is perpetually
frustrated.

4. On account of these characteristics of the Indian state, all
institutions of state failed grievously, and are on the verge of
collapse. This collapse encompasses the political executive, the
legislatures, the bureaucracy and the judiciary. None can be
blamed in isolation, nor can any segment escape the blame.
However, this failure is not because individuals have failed, nor
is it because the society lacks values, but it is a result of the
fundamental flaws in our governance structure, which make this
crisis inevitable.

5. In the face of the state's failure to optimize results, and
its incapacity to check malignant use of power, the citizen is
increasingly frustrated. Unlike the elites, who laud the modest
accomplishments of state functionaries against heavy odds, the
ordinary citizens are deeply discontented as they perceive the
vast area of non-performance, and the pervasive insensitivity,
corruption and unresponsiveness. As repeated rejection of status
quo and voting out the party in power do not yield any positive
results, there is increasing frustration, and easy recourse to
violence.

6. As a result, the nation faces three grave dangers. First,
there is increasing lawlessness and anarchy in most parts of the
country. As all governance structure fails, the citizen is no
longer sure of the state meeting its obligations in any sphere.
Any citizen, unadorned by power and privilege, who ever
approaches any public office in the country to obtain something
that is due to him as a matter of right, is fully aware of the
magnitude of the state's failure. The all-pervasive corruption,
harassment, delays, inability of the courts to render justice in
time, the complexity of our administrative system that makes it
wholly unintelligible to hapless citizens, the frequent breakdown
of public order and increasing insecurity -- are all the visible
manifestations of this anarchy. In a true sense, we are already
in a state of anarchy. This anarchy is rising rapidly, and
already in several pockets of the country life is never
predictable. Justice, human rights, freedom and high quality of
public services are all remote concepts which have no relevance
to the day-to-day life of ordinary citizens.

7. The second danger ahead of us is the possibility of despotism
by invitation. As the propertied and educated middle and upper
classes, who have great stakes in peace and order, are
increasingly disenchanted with the governance process, they are
coming to the dangerous conclusion that freedom and democracy are
synonymous with chaos and anarchy. Most of our urban middle
classes have already come to this conclusion and have become
votaries of some form of authoritarianism that can bring order
and peace to the society at any cost, so that they can pursue
economic growth unhindered.

8. In this milieu, the threat of dictatorship does not lie in a
possible coup d'etat, but it may creep into the system by the
acquiescence of the middle and upper classes - the political
class, bureaucracy, armed forces, police, professions and the
business class. In their desparate quest for order at any cost,
they have little understand-ing of the nature of dictatorship, or
its limitations, and the lessons of history are all-too-readily
forgotten. Setting aside the fact that freedom and democracy are
inalienable birth rights of every citizen, there is no guarantee
that the right type of philosopher-statesman will ascend to the
top in this dictatorship by invitation. If, by some good fortune,
a philosopher-statesman does emerge as the supreme leader, there
is no reason to assume that he will continue to be good after
having tasted absolute power. If India, by some miracle, finds a
philosopher-statesman-dictator who remains true to the ideals of
the nation for life, there is no way by which he can actually
deliver the goods all alone in a vast and complex plural society
in a highly centralized despotic regime. If, by some modern
electronic marvel, the centralized regime does find the means of
governing our vast and complicated polity in a despotic manner,
there is no reason why the ordinary people, who have no real
stakes in order, should give up freedom and adult franchise,
which are the only elements that lend dignity to their
impoverished lives. The rejection of depotism by the poor and the
deprived will result soon in a massive upheaval and bloodshed,
and society will face even greater chaos and disorder.

9. As a wise man said, while the capacity of man for justice
makes democracy possible, the propensity of man for injustice
makes democracy necessary. Morally or pragmatically, there is no
substitute to democracy. Any efforts to the contrary are not only
doomed to failure, but will also drive the nation to disaster.

10. The third grave danger threatening the nation is the spectre
of balkanisation. As authority and order break down, and as the
governance apparatus fails to serve its main purpose of
maintaining public order and ensuring cohesion and harmony in
society, disintegration becomes inevitable. As the centralized
and inert polity proves incapable of reform, many thinking
persons, daunted by the vastness of the nation, its incredible
plurality, and the complexity of problems, may be compelled to
conclude that the only way of bringing about reform strengthening
democracy and fulfilling people's aspirations is to break up the
country. In addition, the economic liberalization process itself
may exacerbate this latent tendency towards balkanisation. As
some regions and states respond more positively to growth
impulses, and have a better social and economic base to enlist
mass participation in production process, they will be far ahead
of the rest of the country. The disparity between, say 12% annual
growth rate in one region and 3% growth rate in another, may not
appear to be dramatic at first sight, but within a decade it will
be very great. If both regions started at the same level of GDP
per capita, the faster-growing region will have three times the
GDP per capita at stable population. If already the faster-growing
region has double the GDP per capita, then the disparity will be
six times. Such disparities are unsustainable among regions in
democratic society. The resultant mass migration from the poorer
regions to the more prosperous areas in an already over-populated
country will create untold havoc and suffering. Inevitably the
social strife will lead to erection of barriers against entry and
will lead to eventual balkanisation.

11. Many Indians pin their hopes on economic liberalization to
arrest and even reverse the drift, and to strengthen order,
democracy and unity. However, there is no ground to believe that
economic reform in itself, though welcome and over-due, will be
able to resolve our crisis. On the one hand, our governance
structure failed to ensure adequate human development. The
failure of our delivery systems meant appallingly low levels of
literacy and skills, poor health coverage and hopelessly
inadequate rural infrastructure. As a result, the vast majority
of Indians are not in a position to participate in the productive
process of the nation meaningfully. Consequently, the fruits of
economic reform, if unaccompanied by transformation of our
governance structure and delivery systems, will be at best
modest, transient and self-limiting.

12. As the latent, untapped productive and entrepreneu-rial
potential of our middle and upper classes is now unfettered,
there will be moderately high growth rates for some time.
However, as the bulk of the population is excluded from this
economic reform and growth process, high growth rates cannot be
sustained and they will eventually taper off. China could
successfully launch economic reform in 1978 on a superb base of
human development, skills and rural infrastructure, built
painstakingly between 1948 and 1978. Without such an enduring
base, China would not have recorded spectacular growth rates now
witnessed --about 10% compounded annual growth rate for an
unbroken 18 year period. India certainly has the potential to
match such growth, but only if we create a similar human
development and rural infrastructural base.

13. In fact, economic reform with modest growth, unaccompa-nied
by reform of governance structure, may exacerbate the dangers of
authoritarianism. As the dominant groups seek stability, public
order and opportunities for growth, they may be frustrated by a
crumbling governance structure incapable of creating conditions
for growth. The examples of China and South East Asia may be
easily misinterpreted, and the middle and upper classes may come
to the wrong conclusion that the full fruits of economic reform
cannot be realized, unless there is an authoritarian regime,
albeit benevolent, to provide order and stability. Little
realizing that true democracy is in fact more conducive to
competition and growth, these groups may throw the blame for poor
results on the democratic process. Such authoritarianism is
neither morally acceptable, nor will it achieve high growth,
because the real problems are poor human development, low level
of skills and inadequate rural infrastructure. In a plural
society, authoritarianism will fail as comprehensively as our
quasi-democratic state with poorly designed institutions, and
without people's participation and role in governance. The only
antidote to the ills of our democracy is more, better and truer
democracy and not extinguishing the fires of freedom and self-governance.
14. The danger of balkanisation being accentuated by wide
regional disparities, which are inevitable in the absence of
reform of governance structure, has already been discussed in
chapter 2 (para 10).

15. True democracy has five essential ingredients - freedom, self-governance,
empowerment of people, rule of law and self-correcting
institutions of state. Freedom is the right of any individual to
do as he pleases as long as his actions do not impinge on the
freedom of others. The Indian state can be ranked quite high in
terms of freedom of its citizens. True, there are serious
limitations to enjoyment of freedom for the bulk of our poor on
account of inadequate resources and skills, which is largely a
result of the failure of the Indian state. However, there are not
many state-imposed fetters to individual freedom and choice. On
an imaginary scale of 0 to 100, India's score in terms of
individual freedom will be probably above 60, and in some
respects may be approaching 80 or 90.

16. Self-governance is the right of citizens to govern themselves
directly or indirectly. What happened in 1947 was mere transfer
of power from the colonial masters to the indigenous oligarchies.
In our anxiety to preserve unity and order at all costs, we
accepted centralization of power and bureaucratization, and
marginalised the role of the people. We accepted many
institutions purely on grounds of familiarity rather than
suitability to our conditions and needs. As a result, self-governance
is limited to an occasional exercise of franchise,that too when
permitted by the local bigwigs. As the choice is often between
Tweedledom and Tweedledee, this franchise has no real impact on
the outcome, and self-governance became largely illusory. On our
imaginary scale, self-governance component of Indian democracy
can probably be quantified at about 25, a poor score for any
vibrant democracy.

17. Empowerment is the ability of citizens to influence the
course of events on a sustained basis and to make meaningful
decisions on matters of governance having impact on their own
lives. In a highly bureaucratized and centralized milieu, with
most local institutions beyond the reach of stake-holders'
influence, as stake-holding and power-wielding are
divorced,empowerment of citizens is at a low-level. The local
school,Primary Health Centre,or civic services -- are all beyond
citizen's influence. The local public servant is unaccountable to
people, and is often the master,rather than their servant. Many
procedures are rigid, incomprehensible and highly
formalized,preventing access to, and influence by,most ordinary
citizens. Conse-quently, in terms of empowerment, on our
imaginary scale our democracy would score no more than 5 or 10,
an appallingly low score for any functioning democracy.

18. Rule of law is the concept of people being governed by law,
and all citizens, irrespective of station and rank, being subject
to the same laws to the same extent. It is the basis of all
democratic governance, and all our institutions, including the
executive and judiciary, swear by it. However, in reality, the
centralised autocratic functioning of the political parties,the
flawed electoral system,highly secretive,opaque functioning, the
ubiquitous patronage system, the all-pervasive corruption and the
excruciating delays in obtaining justice in law courts - all
these made sure that the people with access to power ,muscle and
means are more equal than the ordinary citizens. As a result,
rule of law has been given the go by in most cases and most
citizens have resigned themselves to lives of indignity and quiet
desperation.

19. Self-correction is the ability of institutions of state to
constantly learn from past experience and improve themselves in
order to serve the people better. No design is ever perfect and
no system,however well-constructed, can ever conceive of all
possible eventualities, and provide for them. In any reasonably
efficient and responsive governance structure, there must be a
high degree of flexibility and self-correcting mechanism, so that
the system is functional. In India, almost all institutions of
state have become moribund and dysfunctional. There is no real
self-correction visible on an enduring basis or in a meaningful
manner. On our imaginary scale,the score for self-correction is
almost zero.

Root of crisis - design of democracy

20.From the foregoing analysis it is clear that the Indian crisis
is systemic. Our democracy is extremely flawed, and its poor
design ensured the eventual breakdown. Our founding fathers were
undoubtedly men and women of great calibre, commitment,depth and
understanding. However, the compulsions of establishing and
maintaining order at the earliest in the wake of the trauma of
partition forced them to opt for continuity in the instruments of
governance. The holocaust accompanying partition was undoubtedly
extraordinary by any standards, and is unprecedented in peace
time anywhere in the world.About a million people, both Hindus
and Muslims, were butchered for no fault of theirs. About 600,000
people were maimed and more than 300,000 women were brutally
raped. Given these cataclysmic events at the time of partition,
restoration of order and maintaining the unity and integrity of
India were of paramount importance, and our leaders
understandably opted for continuance of time-tested instruments
of governance. Many scholars have pointed out that there is about
80 per cent congruence between the Government of India Act of
1935 and the Indian Constitution of 1950 on account of these
compulsions.

21. In addition, the euphoria accompanying the transfer of power
led to a general belief that the moment the Indian leaders
acquired power, things would automatically improve even with the
old instruments of governance. However, the subsequent events
belied these hopes. In the early years after the independence,
the aura of freedom struggle, the towering stature of the early
leaders associated with that struggle, the hope of better things
to come and the inadequate understanding of the loopholes in the
mechanics of governance ensured certain measure of stability,
hope and harmony. As all such hopes are dashed, and persistent
rejection of parties in power does not seem to result in any
significant tangible improvement, people are increasingly sullen
and resentful.

22. The crisis of governability is undoubtedly grave. The nature
and magnitude of our problems are daunting. What we are
witnessing is the collapse of the Indian Republic. However, the
Indian crisis is by no means intractable or immutable. There is
no reason why India should inevitably succumb to the spectres of
anarchy, authoritarianism or balkanisation. Over the years, the
intractability of the Indian crisis, and the impossibility of
successful reform have been overemphasized. India has the
strength, resilience and intellectual and moral resources to
respond to this, the greatest challenge of our history, with
courage, imagination and creativity. However, we must first
recognize that the only realistic and enduring solution to the
crisis engulfing the Indian state is a holistic,peaceful,
democratic transformation of the republic, with the objective of
building at all levels free, self-governing, empowering, self-correcting
institutions, capable of maintaining peace and harmony,
preserving order and stability, strengthening unity and
integrity, enabling freedom and participation and promoting
growth and prosperity.

Limitations of Isolated Reforms

23. Isolated efforts to correct individual ills have largely been
frustrated or failed because of the evil engulfing all facets of
governance. No matter how well-meaning and necessary an isolated
reform is, it will not yield adequate dividends, when it is
unaccompanied by the other necessary changes. In this backdrop,
the vested interests and status quoists can always cite the
failure of the partial reform and use it as an argument against
any serious reformhalf-hearted,well-meaning, . Time and again,the
isolated, necessary but insufficient reforms have failed to
energize the polity and improve the content of our democracy. The
sporadic attempts to improve the conduct of elections, the
repeated attempts of the various Administrative Reforms
Commissions, the many Law Commission Reports,the introduction of
the much talked about Panchayati Raj institutions in the 50Anti-defection
Act through the s and 60s and the 73rd and 74th constitutional
amendments in the 90s, and efforts like the amendment of the
constitution are all examples of sporadic, isolated, insufficient
and ultimately ineffective efforts to reform the Indian
governance system over the years.

24. In this all-pervasive crisis of governability, the only
realistic way out is a peaceful, democratic, holistic
transformation of Indian governance structure. Such a
transformation must address the basic processes of power and
ensure that truly democratic,self-correcting mechanisms are in
place. Every facet of reform must counter adequately the elements
of crisis of Indian governance - the imbalance between the
exercise of positive and negative power, the alibis for non-performance
on account of the disjunction between the vote and welfare of
citizens on the one hand, and between authority and
accountability on the other, the incapacity of the administrative
- legal structure to reward good behaviour and punish bad
behaviour consistently, and the increasing incompatibility
between honesty and survival in political executive office on the
one hand and honour and politics on the other.In such a
comprehensive reform process, each element of reform will
reinforce the other elements, bringing out synergies and
minimizing risks. A holistic reform also ensures adequate checks
and safeguards against failure of any institution individually.
Instead of failure at one level leading to failure at all other
levels eventually, failure is arrested quickly and countered
effectively before it does serious damage to the body politic.
All the elements of transformation of our governance structure
together must be capable of strengthening every facet of our
democracy - freedom, self-governance, empowerment, rule of law
and self-correcting institutional framework.

Reform Agenda - Stakes for all

25. We must keep in mind at all times, however, that the
objective is to achieve transformation of our governance
structure. Such an effort calls for the broadest measure of
agreement among all segments of society, irrespective of
competing, sometimes conflicting, sectional interests. All
segments of society must have stakes in the agenda, and highly
divisive and contentious issues must be left to public choice
through the normal competitive electoral process. What we must
aim at is creating a truly democratic framework that offers a
platform for various ideologies and policy options to be
discussed, debated and chosen by the people from time to time. It
necessarily follows that policy issues should be left out of the
national reform agenda. To be precise, those issues that have a
bearing on the basic process of governance and the five
ingredients of democracy as outlined above, viz: freedom, self-
governance, empowerment of people, rule of law and self
correcting institutional frame work, should constitute the agenda
for democratic reform. Those issues which have no universality in
their application and form part of the `zero sum game', whereby
one segment gains at the cost of the other, must be excluded from
the reform agenda and must be left to the competing political
forces of the day. Only the essential principles of democracy,
the basic rules of governance and constitutional safeguards are
sacrosanct and non-negotiable and must be constitutionally
sanctified in order to provide the basic framework for the
competing political parties and individuals to acquire power and
pursue those policies which have the broadest measure of public
support from time to time.

National Agenda For Holistic Reform

26. We have broadly concluded in the foregoing chapters that the
crisis of governance is affecting all organs of state and is
systemic in nature. The resolution of the crisis has to be based
essentially on the fundamental democratic principles of
enlargement of freedoms, genuine self-governance, true
empowerment of people, application of rule of law, and creation
of self- correcting democratic institutions.

The reform agenda has to be minimalist and non-partisan, and must
deliberately eschew highly contentious and divisive issues, so
that the widest measure of consensus is possible. It must be
practical and rooted in the Indian ethos, and must take into
account our experience of working of the Constitution so far.
Keeping in mind our past lessons and future objectives, the key
elements of fundamental, holistic, democratic reform of our
institutions of governance are suggested in the following six
chapters:

1. Democratization of political parties
2. Separation of executive and legislature
3. Safeguards against executive abuse
4. Decentralization of our governance
5. Efficient and responsive bureaucracy, and
6. Speedy and efficient justice system

27. Political parties are vital ingredients of a vibrant
functioning democracy. They organize people, espouse causes,
aggregate interests, seek people's mandate for a platform,
acquire power, endeavour to set the national agenda, and
implement it while in power. However, these vital instruments are
almost entirely unregulated in India and their internal
functioning is generally arbitrary, autocratic,undemocratic,
invisible and unaccountable. It is inconceivable that
undemocratic political parties can effectively safeguard and
strengthen democracy. Many of the ills of our governance system
can be directly traced to the undemocratic and unaccountable
functioning of the parties. In reality, the parties in India
function like private estates, the election process thus becoming
a competition among closed oligarchies to acquire political power
and control state resources. The first major area of reform must,
therefore, be democratization of political parties in the
following respects:

1.1 Membership

28. Most political parties do not even have proper membership
rolls at various levels of their functioning. It is well-known
that the major political parties have bogus members enrolled by
overzealous fact could not conduct their organizational elections
on the ground that they have bogus members. In many cases control
of entry into the party gives enormous leverage to the bosses.
Potential adversaries are denied entry and rivals are expelled
from time to time for having the audacity to stand up to the
party bosses. In the process, dissent is thwarted and
unscrupulous coteries perpetuate their hold on party structures.

29. A political party is often a symbol of aspirations of
millions of people and it represents the beliefs, dreams,
concerns and experiences of countless people over a period of
time. Denial of access to such parties or expulsion is the
equivalent of political death sentence. By their very nature,
parties are an integral part of the history of a nation and
heritage of all society. Therefore, exclusion, entry or exit
barriers, or forcible expulsion are tantamount to negation of the
democratic rights of citizens.

30. Some people may argue that those members expelled may form
another party or seek public support as non- unattached party
independents. However, in reality no independents or unattached
persons have ever made a significant impact on public life or
succeeded in acquiring power in any major democracy in history.
Even in mature democracies like Britain or the United States, new
parties do not make a serious impact on public life. The travails
of Liberal Party in the U.K. and the failure of an independent or
third party candidate to acquire high public office in the U.S.
clearly demonstrate that new political parties cannot be a viable
option for dissenters. There is too much investment of a lot of
energy , effort and passion by thousands of people in a political
party to allow it to be a captive instrument in the hands of an
unscrupulous, oligarchic coterie.

Therefore, for democratic functioning of political parties, it is
imperative that all membership is open without any barriers.
Individuals not towing the majority line can be sidelined by
merely denying them leadership positions and marginalising them
if the majority so wishes, but not by expelling them and denying
them forever the opportunity to effectively propagate and pursue
their political agenda.

31. In view of this, the following are the suggested major
reforms to be carried out for democratization of political
parties in respect of membership.

i) Membership must be voluntary and open to all citizens;

ii) No member can be removed or expelled from primary membership.
A citizen who is a member can voluntarily leave the party but
cannot be forcibly removed. However, he can be removed from
elective offices within the party by majority consent, in
accordance with the party's constitution.

iii) There must be a prescribed membership fee within reasonable
limits to be paid by the members.

iv) Every member of the political party must have a photo
identity card with a distinct membership number and other details
incorporated.

v) Membership rolls must be published polling station-wise and
constituency-wise to facilitate public scrutiny.

Internal Democracy

32. As a perceptive political observer commented some years ago,
in the Indian political parties, the man who wears the crown is
the king. Leadership is often acquired through undemocratic means
and retained by the power of patronage rather than support of
members. This paves the way for oligarchies dominating the
political process and offering to people inadequate choice
between Tweedledum and Tweedledee.

33. Therefore, parties by constitution or law must be com-pelled
to practise internal democracy in a verifiable manner as follows:

i) The membership rolls published by the political parties at the
polling station level and constituency level must be the basis
for elections within the party.

ii) Every party at every level - constituency, district, state,
national - shall elect its office bearers annually in the
prescribed manner.

iii) The method of election within the party should be prescribed
broadly by law, giving sufficient flexibility to the needs of
individual parties.

iv) The annual election process within the political party must
be supervised by law by an external statutory or constitutional
authority like the Election Commission.

v) The law or the external regulatory agency shall have no power
to determine the policies to be espoused by the parties or
influence the outcome of elections.

1.3 Choice of Candidates for Elective Public Office

34. The most undemocratic arena of functioning of political
parties debilitating our democratic process is the choice of
candidates. The party bosses in command at the time have almost
unfettered personal discretion in nominating candidates for
public office on behalf of their parties. There is no open,
democratic choice of candidates by party members and the people
at large are denied genuine choice between democratically elected
alternative candidates. The election process has become totally
distorted and is reduced to a cruel choice between Tweedledum and
Tweedledee in most cases. Many concerned citizens are repelled by
the ugly choices and often unwisely prefer to stay away from the
electoral process. As the candidates are imposed on the unwilling
public and party members, no matter which party or which
candidate wins, the real losers are the general public and the
democratic process itself.

35. Therefore, the choice of candidates for elective public
office must be democratically made by the recognized political
parties as follows:-

i) Every member of the party who is eligible to hold a public
office under the constitution and law shall have the right to
seek the nomination of the party for such public office.

ii) The party's nominee for elective public office shall be
chosen by a ballot in the prescribed manner.

iii) At the lower level, all the party members in the
constituency will be electors directly for choosing their party
nominee. At the higher level,the delegates or electors elected by
the primary members will choose their nominee to make the process
of election of candidates practical and less cumbersome.

iv) This selection process of the nominee of the party for
elective public offices shall be supervised by an external
constitutional statutory authority like the Election Commission
to ensure fair opportunity to all members of the party.

1.4 Political and Campaign Funding

36. Political parties collect vast sums of money,
mostly from undisclosed sources, for their normal activities,
election campaigns, public rallies and advertisements, and to
enhance the prospects of individual candidates. It is widely
known that a huge public rally involving mobilization of 100,000
people often involves an expenditure of crores of rupees. It is
widely acknowledged that a serious campaign for a state assembly
constituency would entail an expenditure of about Rs 25 to 30
lakhs in most major states and the campaign for a parliamentary
seat is closer to a crore of rupees. There are several instances
where candidates spend several times these amounts. In almost
every single election in the country, all major party candidates
are forced to exceed the expenditure limit prescribed by law. In
virtually all cases, the sources of funding and other expenditure
are totally undisclosed and unaccounted. As a result money-power
is acquiring dominance in our elections and has become the chief
source, as well as primary cause, of corruption in public life.
The campaign cost of parliamentary general election for all
parities put together is of the order of about Rs 1500 crores to
Rs 2000 crores. Similarly in most major states, for Assembly
elections the campaign cost of all parties put together is about
Rs.150 to Rs.200 crores.

37. Therefore regulation of political and campaign funding and
utilization on the following lines is absolutely critical for the
future of our democracy:

i) There must be realistic and reasonable ceilings on campaign
expenditure in place of the present wholly unrealistic and almost
universally disregarded ceilings.

ii) There must be reasonable limitation imposed on the quantum of
funding by individuals, or corporate entities. These ceilings
must be uniform for all individuals and must be in accordance
with rational criteria in respect of corporate entities in the
form of a fixed proportion of the net surplus generated in a
given year.

iii) The funding must be open and by cheque with full and
compulsory disclosure to the public, tax authorities and Election
Commission.

iv) All funding within ceilings prescribed must be given
appropriate tax incentives so that legitimate funding for
political activity is encouraged.

v) Any violation of funding disclosures or exceeding ceilings
must be punishable with a minimum imprisonment of, say two years.
In case of prosecution, the burden of proof must rest with the
accused.

vi) There must be compulsory statutory audit of all political
party funding and campaign expenditure.

vii) The candidates must be obliged to furnish a full statement
of accounts. Any violation or concealment and non-disclosure must
entail a minimum imprisonment of two years. The burden of proof
must rest with the candidates.

viii) The auditing of campaign funding, party funding and
expenditure should be undertaken by an external statutory /
constitutional authority like the Election Commission.

1.5 Other Electoral Reforms

38. Proliferation of non-serious candidates, mushrooming of small
political parties and excessive election expenditure have all
become the bane of our electoral system. Also the identification
of every elected functionary with specific territorial
constituency has led to unhealthy scramble for resource
allocation and patronage distribution, with few legislators
having the will, courage or strength to pay attention to the
larger issues of governance.

39. To overcome these unhealthy trends, the following reforms are
needed:

I) Political parties must be recognized only if they fulfill the
conditions listed above and have obtained at least 10 percent of
the votes polled in the area of their operation - regional /
national - in the preceding election. Until such time they obtain
10 percent of votes they will be unrecognized political parties,
though registered. Even registered unrecognized
political parties must conform to the regulations as prescribed
in order to continue the registration.

ii) Unregistered political parties and non-party candidates can
be on the ballot only on obtaining written support of a
prescribed minimum number of voters, say one percent, in the
constituency / territory.

iii) There must be a reasonable security deposit for contestants
which would be refunded only if 10 per cent of the valid votes
are obtained by the candidate. This amount should be of the order
of Rs.25,000 for an assembly constituency and Rs.1 lakh for a
parliamentary constituency.

iv) 50 per cent of all seats in the representative bodies should
be filled by proportional representation. Only those registered
parties which obtained at least 10 per cent of the valid votes
shall be eligible for proportional representation.

v) The remaining 50 per cent of the seats will be filled by the
first-past-the-post system constituency-wise.

vi) The list of party nominees for election directly constituency-wise
or through proportional system shall be chosen democratically by
party members as outlined above.

vii) All parties must have access to electronic media operating
within the territory, whether state-owned or private. There must
be an appropriate law to make it mandatory for the media to
provide equal, free, unpaid access to all recognized parties. The
Election Commission shall have the authority to determine the
modalities of such access from time to time. Registered political
parties will obtain access only after being recognized.

viii) The state shall provide a common platform for public
meetings to all recognized political parties under the
supervision of the Election Commission in each constituency. The
modalities shall be determined by the Election Commission and the
expenditure so incurred shall be borne by the state.

ix) Public rallies shall be strictly regulated and preferably
discouraged during election campaigns. There can be public
gatherings in closed doors under covered roofs.

x) There can be paid advertising by the candidates in electronic
media and print media if they so choose, which shall be taken
into account while calculating the election expenditure.

xi) Every item of expenditure shall be by cheque and any
violation by the candidates or agents or suppliers of material
etc. shall entail a minimum imprisonment of two years if proved.
The burden of proof shall rest with the accused.

xii) Every voter, to be eligible for voting, shall have a photo-identity
card issued by the election authority.

xiii) Voting shall be by electronic voting machines as far as
possible, to facilitate fair polling and easy counting.

xiv) Campaign period shall be reduced to two weeks.

xv) Candidates shall be barred from contesting in more than one
constituency.